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Abstract

A study was carried out to establish the effect of agency banking strategy on customer
service in Kenya commercial bank limited. The study had three objectives to achieve: To
establish the various services offered by KCB "Mtaani" agents; to find out the
relationship between agency banking strategy and customer service and to establish the
strategies that can be used by KCB to enhance customer service.
The research adopted a descriptive design. Data was collected from KCB "Mtaani"
agents operating within Nairobi and its environs through semi-structured questionnaires.
The agents were sampled through purposeful or judgmental sampling due to the nature of
their dispersion. The data collected was analyzed using means and frequencies and
correlations. The findings were presented in tables.
It was established that agents perform several functions or activities on behalf of the
bank. The functions include accepting cash deposits, effecting cash withdrawals, opening
accounts for new customers and to some little extent issuing interim bank statements.
There are some services that are however not common with the agents such as foreign
currency transactions, issuing cheque books to customers and processing of loan
applications.
The study also established that there is a strong link between the use of agency banking
and customer service improvement. The respondents confirmed that the agents have
greatly improved the level of customer service in Kenya commercial bank limited. The
study recommended that KCB should look for ways of motivating the agents such as
through the use of performance based bonuses. This will motivate them to work better
thus improving customer service. It was recommended that this study can be replicated later to
establish whether there are any changes in agency banking and customer service in banking.